Power Balances Shift. Back in the industrial era, workers organized in unions. But who needs a union when you can organize in five minutes on a social media platform and can create income from the comfort of your computer, smartphone, or car? The balance of power sits in the worker’s hand.
When it comes to designing the future of work, one size fits none. Discovering success isn’t about a hybrid model or offering remote work options. Individuals and organizations are looking for more freedom. The freedom to choose the work model that makes the most sense. The freedom to choose their own values. And the freedom to pursue what matters most. We reached out to successful leaders and thought leaders across all industries to glean their insights and predictions about how to create a future that works.
As a part of our interview series called “How Employers and Employees are Reworking Work Together,” we had the pleasure to interview Miles Everson.
Miles Everson is the CEO of MBO Partners, the definitive market leader in enabling the future of work and improving the well-being of professionals and businesses throughout the world. Before joining MBO, Everson had a rich career with PwC, almost three decades in total. Everson has worked with many of the world’s largest and most prominent organizations, specializing in executive management. He helps companies balance growth, reduce risk, maximize return, and excel in strategic business priorities.
Thank you for making time to visit with us about the topic of our time. Let’s zoom out. What do you predict will be the same about work, the workforce and the workplace 10–15 years from now? What do you predict will be different?
Let’s begin with what will stay the same: the rate of change surrounding the work environment will continue to accelerate. Beyond that, almost everything will change, particularly for white-collar knowledge jobs.
The work environment will rely on a more fractionalized infrastructure in all respects. Today, we have fractionalized technology stacks, fractionalized real estate, and now we’re fractionalizing the workforce so that companies have access to go deep with the skills they need when they need them. And with these deep skills comes a new way of thinking about workforce engagement. One rarely needs deep and specific skills for the long term but instead leverages these skills for more frequent, shorter duration engagements in order to deploy capital efficiently.
However, this trend isn’t just for the corporation; it’s for the worker too. Workers can now develop deep and specialized skill sets and capitalize upon this knowledge for many corporations over the course of their careers, pursuing passions, economic viability, and a better work-life balance than if they devoted their time to one corporation for their entire careers.
What advice would you offer to employers who want to future-proof their organizations?
Employers must first open the aperture on the totality of their workforce. It no longer includes just captive full-time employees but also their contingent labor sources. The successful employers of tomorrow will leverage this strategic workforce to keep up with deep pools and labor benches of in-demand skills, and savvier employers will strategically recognize and acknowledge this population of skilled independent labor as a significant portion of their workforces.
Acknowledging this first truth: that top performers no longer wish to be traditional, long-term employees should drive a shift in thinking and strategic planning. For example, the Bureau of Labor Statistics has shown that today’s average employee tenure is just 4.1 years, down to the lowest level since 1980. For employees under 35, it’s even less — 3.5 years — and in high-growth areas like technology, that number may be as little as 18 months. Per Bankrate, half of American workers will look for a new job within the year.
When employers recognize that even their so-called “permanent” workforce is transient, they will also see a direct implication on how they obtain and retain institutional and organizational knowledge and recognize a need to shift how one manages and procures this knowledge to reflect a more variable workforce.
Successful leaders will embrace the differentiation between institutional knowledge and having heterogeneous thinking and knowledge flow thinking. Effectively, embracing that a larger and more diverse workforce can help combat the “it’s always been done this way” way of thinking with new and fresh perspectives that spur innovation.
More simply, don’t confuse institutional and systemic bias for institutional knowledge. Companies that embrace the need for institutional knowledge often amplify the systemic bias of the institution. One of the best ways to mitigate this issue is to engage a more diverse labor base that includes new talent, e.g., independent labor.
What do you predict will be the biggest gaps between what employers are willing to offer and what employees expect as we move forward? And what strategies would you offer about how to reconcile those gaps?
Too many employers advocate for people to become long-term tenants in their company as employees, whereas today’s employees are looking for varied experiences that enrich their knowledge and wealth.
The two primary things that come to mind when looking at the differential between what employers want and what employees need: employers must embrace employees as workers in a workforce, not just as employees of their company. This may mean giving workers the flexibility they desire, not just where they work but also how.
MBO Partners’ State of Independence — the longest-running look at the independent workforce in America, shows that in 2021, the 51 million independent workers in our country are growing faster than ever before (a 34% annualized increase) and also that they are at their highest levels of happiness, satisfaction, and earning in the 11 years of our study. By 2025, more than half of the U.S. workforce will be or will have been independent at some point in their careers.
By this logic, the single biggest thing employers must offer is the flexibility to allow workers to work not just where, but how they wish to, as many of the top talent in America will soon choose not to be employees of a corporation, but employers of themselves as independent business owners.
We simultaneously joined a global experiment together last year called “Working From Home.” How will this experience influence the future of work?
The trend of working remotely — not just about working from home anymore — was accelerated by as many as five to ten years because of the pandemic. The implication of that is now it has become a societal norm for an individual to want to work remotely, or potentially have to, or have a hybrid model. As a result, companies must embrace the flexibility in the work arrangements that workers now expect.
It is worth a more nuanced point: the capability from a technological perspective existed well before COVID-19. The societal acceptance that it’s ok or even preferred to work remotely will forever change the future of work.
We’ve all read the headlines about how the pandemic reshaped the workforce. What societal changes do you foresee as necessary to support a future of work that works for everyone?
Historically, a corporation provided three things to its workers:
- A career model that lasted for a significant portion of one’s employment.
- Defined benefit plans to offer comfort in retirement.
- Health and welfare plans to take care of one’s personal needs.
Today, the bond between corporation and employee is broken, as most of these tenets have largely been eliminated or diminished beyond recognition.
First, the tenure of employees is the lowest it has ever been — just 4.1 years on average. Next, the percentage of employers offering a defined benefit offering is just three percent, down from over 60 percent in 1980. Lastly, health and welfare plans are increasingly expensive and provide less and less coverage, although this area may in many ways be seen as the last viable tie to employment. When this last tie to the employer-employee relationship is broken, the current employment structure in America will also crumble.
Our government must evolve, too, devising new systems for both tax collection and benefits distribution not tied to an antiquated notion of employer-employee relationships. The political process needs to recognize that people want to choose the form in which they provide work and to whom, and there should not be government or regulatory overreach trying to mandate how it is done.
What is your greatest source of optimism about the future of work?
I feel incredibly optimistic about the future of work. MBO’s research shows that independent workers are happier, healthier, and wealthier than their traditionally employed counterparts; 68% also feel more financially secure.
Innovation is at an all-time high. From online marketplaces (which 40% of independent workers now use to find projects) to simplified technologies to establish business entities (such as LegalZoom) and to build and market digital personas and stores (think social media, as well as online branding platforms like Squarespace and Shopify). These tools and technologies make it easier than ever to go into business with little to no startup costs or risk.
The greatest point of optimism I have is that barriers making it easy for workers and enterprises to select who they want to work for has never been lower, which means that opportunity has never been greater.
Our collective mental health and well-being are now considered collateral as we consider the future of work. What innovative strategies do you see employers offering to help improve and optimize their employee’s mental health and well-being?
Give people the control to do the work they love the way they want, and they will be happier, healthier, and wealthier as a result. Our data shows this is true about independent professionals, but the same logic applies to employers looking to attract top employees. The employer must give up some control to be an attractive place to let people do the work they want to do. This may mean letting people work remotely or implementing attractive compensation and benefits structures to bring in the best employees.
At MBO Partners, we believe that well-being starts with open, honest, and regular communication with our employees, and we do that via a weekly 30-minute all-hands huddle. Further, we have a daily 90-minute quiet period (without internal meetings) to encourage deep work and allow people to take a break from digital interaction as necessary during the day. We also offer additional benefits to our employees, such as an annual wellness stipend and regular activities to stimulate physical, emotional, mental, spiritual, and financial wellness.
It seems like there’s a new headline every day. ‘The Great Resignation .’‘The Great Reconfiguration’. And now the ‘Great Reevaluation’. What are the most important messages leaders need to hear from these headlines? How do company cultures need to evolve?
There are many important takeaways and headlines of the trend we’ve deemed “The Great Realization” — the idea that workers and employers alike realize that there is much that needs to change about the world of work.
There are three key takeaways:
- Workers have a much greater ability to choose who they work for, and they will work for a shorter duration for any one company than what we have historically seen.
- Companies need to recognize that their workforce is comprised of all workers that they should have access to, not just their full-time employee workforce.
- Projects and outcomes will measure value creation that gets delivered by your workforce, and there will be a shift away from full-time organizational chart-driven operating models to project-based, value-driven work outcomes.
Let’s get more specific. What are your “Top 5 Trends to Track in the Future of Work?” (Please share a story or example for each.)
- Workforce Optimization: Plan for the Fractionalization of the Human Asset Class. In corporations today, there’s no asset on the books related to human capital. Instead, they’re treated as an expense. Whether it’s vacation or pension accruals, it’s a liability. We all know people are an organizations’ most significant assets. We just haven’t figured out a framework for valuing human capital to reflect it yet. But change is coming. Efforts to introduce robust measures of human capital into financial reporting have accelerated in recent years as market interest in understanding how companies manage and measure human capital grows. In 2022, we’ll continue to see the fractionalization of the human capital asset class accelerate and savvy businesses begin to articulate a strategy for measurement.
- Power Balances Shift. Back in the industrial era, workers organized in unions. But who needs a union when you can organize in five minutes on a social media platform and can create income from the comfort of your computer, smartphone, or car? The balance of power sits in the worker’s hand. Analysts may call this The Great Resignation, but I call it the Great Realization. If a person is good at what they do, the choice is theirs, both about where and with whom they work. For in-demand talent, most of whom say they are happier and healthier than in a traditional job, this may mean spacing between five or six clients, spreading the risk across a much larger spectrum than a single employer, and likely driving even more income as a result.
- Normalization of Global Wage Scales for White Collar Jobs . While we’re not likely to see an equilibrium anytime soon, we’re certainly already seeing wage scales normalizing in high skill areas worldwide, such as in-demand programming work. Remote work has contributed to this greatly. When the same job and functions can be done remotely, they can be done by people who operate in lower cost of living locations. As organizations evolve, they will need to plan for the rising cost of offshore talent in highly skilled areas and the normalization of wage scales for domestic workers.
- The Government will Continue to Pursue Protectionist Policies — and it Will Eventually Backfire. Some of the largest sources of tax revenues are wage taxes and income taxes. It’s no secret that that government will continue to pursue more protectionism policies to avoid losing those tax dollars. They may frame it as a well-intentioned but misguided attempt to prevent a race to the bottom, but the reality is that politicians don’t know how to handle independent work. While in 2022, the government may not take notice, they need to do so eventually. And corporations need to advocate that the choice is in the worker’s hands, at least for those who demonstrate the ability to run a compliant independent business.
- Independence is Here to Stay (and Grow) — and It’s Financially Lucrative. By 2025, more than 50% of Americans will have worked as an independent during their career. That means, in three years, half the workforce, including the talent you’re looking to hire, will identify as an independent. Not as an employee. Savvy enterprises must do more than accept that independence is here to stay. They need to devise a cohesive and comprehensive workforce optimization strategy to not just engage but also to recruit and retain top independent talent. Those who don’t risk being left behind, not just in 2022 but in the years to come.
I keep quotes on my desk and on scraps of paper to stay inspired. What’s your favorite “Life Lesson Quote”? And how has this quote shaped your perspective?
Knowledge compounds and creates options; become a consummate and radical learner of new things.
When it comes to work, the most successful long-term workers are good at learning and applying what they learn. That’s because the rate of change continues to accelerate, and you can no longer rely on “I got my education, and that’s all I need to do.”
Mastering learning will define the options you have for the future of the work that you will do.
We are very blessed that some of the biggest names in Business, V.C. funding, Sports, and Entertainment read this column. Is there a person in the world, or in the U.S., with whom you would love to have a private breakfast or lunch, and why? He, she, or they might just see this if we tag them.
I’d love to meet David Sinclair, the scientist who wrote the book Lifespan. I’m fascinated not just by the work he’s done about having a healthier long-term outlook on life but by his commitment to ongoing and lifelong learning, breaking decades of historic scientific bias and research about what impacts longevity and the future of the brain. I believe individuals like Sinclair will change the world through their efforts.
Our readers often like to continue the conversation with our featured interviewees. How can they best connect with you and stay current on what you’re discovering?
Please visit us online at www.mbopartners.com; we’d love to hear from you.
Thank you for sharing your insights and predictions. We appreciate the gift of your time and wish you continued success and good health.